The Following Events Take Place

question 9

Essay

The following events take place:
1. Interest payments in the amount of $20,000 that are the responsibility of the Debt Service Fund are paid by the General Fund.
2. The Internal Service Fund bills the Special Revenue Fund $25,000 for services performed.
3. The Special Revenue Fund transfers $10,000 to the Internal Service Fund as a temporary loan.
4. The General Fund transfers $150,000 to start an Internal Service Fund.
Required:
Identify the interfund activity as a loan, services provided and used, interfund transfer, or interfund reimbursement and prepare entries in general journal form to record the transactions on the records of the fund involved.

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Definitions:

Cost Functions

Mathematical representations that describe how production costs change with changes in the level of output.

Technology 2

Refers to the application of scientific knowledge for practical purposes, especially in industry, often implying the use of newer or second generation technologies.

Long-Run Cost Function

A mathematical relationship expressing the lowest cost at which a firm can produce any given level of output in the long run, when all input factors are variable.

Output

The total amount of goods or services produced by a company, industry, or economic system.